Financial Services Regulation and Compliance - General Cross Sectoral Aug 2021

DOMESTIC

Interview with the Governor of the CBI, Gabriel Makhlouf

On 29 July 2021, the Governor of the CBI, Gabriel Makhlouf was interviewed by Politico. In the course of the interview, Mr. Makhlouf addressed topics such as the September staff forecasts and the economic outlook for the near future. Mr. Makhlouf outlined that the Delta variant has increased the uncertainty in relation to the September forecasts and that it is premature to speculate but that he is "seeing a rebound… and seeing a recovery". Mr. Makhlouf mentioned that the Governing Council were all on the same page regarding the strategy to recovery and that a decision has not yet been made on PEPP purchases.

EUROPEAN

The EBA Guidelines on AML/CFT Compliance Officers

The EBA is consulting on new Guidelines on the role, tasks and responsibilities of AML/CFT compliance officers, which will apply to all financial sector operators that fall within the scope of the AML Directive. The Guidelines also include provisions on AML/CFT governance set-up, including at group level. This consultation runs until 2 November 2021. The Guidelines set out:

  • expectations of the role, tasks and responsibilities of the AML/CFT compliance officer and the management body and how they interact, including at group level;
  • an expectation that AML/CFT compliance officers have a sufficient level of seniority, including the power to propose, on their own initiative, all necessary or appropriate measures to ensure the compliance and effectiveness of the internal AML/CFT measures to the management body of the entity;
  • the tasks and role of the member of the management board and the role of group AML/CFT compliance officers;
  • the information should be at least included in the activity report of the AML/CFT compliance officer to the management body.
  • Where a financial services operator is part of a group, the draft Guidelines provide that a Group AML/CFT compliance officer in the parent company should be appointed to ensure the establishment and implementation of effective group-wide AML/CFT policies and procedures and to ensure that any shortcomings in the AML/CFT framework affecting the entire group or a large part of the group are addressed effectively.
  • The EBA will hold a virtual public hearing on the draft Guidelines on 28 September 2021 from 10:00 to 12:00 Paris time. The dial-in details will be communicated to those who have registered for the meeting.  

The EBA publishes its AML/CFT Newsletter

The EBA published its anti-money laundering and counter terrorist financing (AML/CTF) Newsletter. The newsletter reported on recent noteworthy events and publications, including that the EBA has set up a new AML/CTF Unit as part of the Innovation, Conduct and Consumers department to reflect its strategic priorities, which include AML/CTF. In addition, the EBA newsletter refers to a public consultation on the revised Guidelines on common procedures and methodologies for the supervisory review and evaluation process (SREP). The proposed amendments include guidance around how prudential supervisors should take ML/TF risks into account in its reviews. The consultation is open until 28 September 2021.

ECB publishes its August Supervision Newsletter

The ECB has published its August Supervision Newsletter. The newsletter reported on a number of recent events and publications, including a report from the ECB that the previous recommendation to suspend dividends in 2020 had been effective. The newsletter also covers the following:

  • the ECB Banking Supervision is asking that banks submit yearly self-assessments through a questionnaire in order to measure IT risk exposure and risk management;
  • Joint Supervisory Teams are reviewing self-assessment questionnaires being submitted by banks and requesting action be taken to address any shortcomings in addressing climate-related and environmental risks. In the coming months, the ECB wishes to publish a report outlining good examples of how banks have effectively developed their practices and plans to combat climate-related and environmental risks. Additionally, the ECB will conduct a full supervisory review in 2022;
  • the majority of banks having overestimated their overall recovery capacity; and
  • the ECB is revisiting its approach to Pillar 2 guidance.

For more information on these topics please contact any member of A&L Goodbody's Financial Regulation team.

Date published: 7 September 2021